The seller sent me the website files first, holding the domain.
Then I paid via Paypal adding in the description something like "Physical product, waiting the delivery of the website files via CD".
The seller transferred me the domain 5 minutes after the payment

At least here in the U.S., Paypal still seems to be denying buyer protection for intangible goods. Just a couple of months ago I had two people from Russia try to cheat me by filing disputes after everything was transferred. Paypal put the funds on reserve and notified me. I responded by escalating the complaint online and stating that it was for digital goods. Gave no further proof. I then immediately called Paypal customer service, who looked at my record with them and then immediately ruled in my favor without even waiting on a response from the buyer. When I'm dealing with lower priced website sales, I state in the listing that nothing will proceed until payment has been made and if it isn't I start the process of cancelling the transaction and relisting the site after 48 hours. Never had to do that though.

Paypal is NOT our friend. I had created many sites for a client/business partner. When we decided to part ways, I sold the sites to him. I had a sales contract that I had him notorize, followed the usual process of a sale. Like a fool I used PayPal and did not use Escrow. After 2 weeks he did a chargeback on his AMEX. Even though Paypal agreed with me, they could not fight the chargeback. I loss 12k in the transaction. I will NEVER use paypal again for selling a site.